Whiz Kids Want Riches Without Risk

July 12, 1987|By Dick Marlowe of the Sentinel Staff

A brash and ambitious band of youthful Americans are giving new meaning to the word ''entrepreneurship.'' Unfortunately, that meaning apparently is ''any business venture, legal or illegal, in which a person can amass a fortune at an early age without risking his or her own money.''

What brings that into focus is the story of Barry Minkow, the latest ''boy wonder,'' who now stands accused of fraud. As it turns out, Minkow, who became a multimillionaire before he reached 21, was an entrepreneur of the worst kind. He built his ZZZZ Best Co. not on the huge carpet-cleaning sales he claimed but on the press releases that caused the company's stock to soar. The bogus releases earned the exuberant and youthful Minkow the adoration of the nation's financial press, which loves a winner almost as much as Minkow loved his Ferrari sports car and his appearances on the Oprah Winfrey Show.

While Minkow now finds himself at the center of an investigation by the Securities and Exchange Commission and a number of other enforcement agencies, it must be noted that the boy wonder could not have performed his magic without the help of journalists, talk-show hosts and stockbrokers who did not do their homework before jumping on the bandwagon and contributing to the con. There have been a lot of good entrepreneurial success stories recently, not all of them based on fraud. A few of the stories are of hard work, new or improved products or services, new ideas and in some cases inventions. But the majority of recently successful entrepreneurs, it seems, simply took an old idea, service or product, created a tale to go with it and let modern marketing and a gullible public do the rest.

I have suspected for some time that entrepreneurship has taken on a new definition. A recent survey confirms my fears.

Research & Forecasts Inc., a New York company, recently polled 502 college students, most of them graduating seniors, at 20 campuses across the country. The survey found that the entrepreneurial spirit was running high. Two- thirds of those questioned said they were interested in becoming entrepreneurs. Being entrepreneurs, many agreed, was not only potentially more rewarding but also more adventurous and exciting than just working for a living.

Not too many of them, however, were interested enough in becoming entrepreneurs to put up their own money. Almost half of those desiring to become entrepreneurs said that the biggest obstacle to starting a business was lack of financial backing. Nearly 60 percent said it was ''very important'' to secure venture capital. Getting things right on the first attempt was seen by the majority as being only ''somewhat'' important.

''Perhaps,'' the R&F report said, ''students feel that if you don't get it right the first time you should make sure you are using someone else's money.'' Not a bad idea but hardly a noble one.

Most of the students agreed that the U.S. economic system encourages entrepreneurism. But the field would be more attractive than it is, the survey confirmed, if the entrepreneurs were not held accountable for their actions. Among the bigger deterrents to entrepreneurship, the survey shows, are the liabilities, lawsuits and legal costs that could crop up if things do not turn out just right.

Many of the students felt that having an original idea, product or service was not nearly as critical to becoming a successful entrepreneur as good communications -- in other words, getting your story down pat and convincing the media to put it across for you. A majority of the students, 64 percent, felt that advertising and public relations were ''very important'' to any entrepreneurial venture.

The federal government knows that the nation is going to need a lot of entrepreneurism in the future to help us overcome our downhill slide as an industrial giant. The Reagan administration has proposed changes in tax laws and policies to encourage private initiative.

But we might be more successfull in achieving that if we put more emphasis on entrepreneurship that would contribute to our society rather than exploit it.